Raney v. Cerkueira Summary

 

Raney v. Cerkueira published June 14, 20196-14-19

 

Snippet: A party bound by an ATRO who is severing a joint tenancy and eliminating the right of survivorship must comply with CC §683.2(c) and the notice provision of FC §2040(b)(3), but requirements may be satisfied in any order.

 

The First Appellate District of California has ruled that during dissolution proceedings, parties may not unilaterally eliminate a right of survivorship in property unless they serve notice on the other spouse and also meet the other generally applicable requirements for such a change; the court further ruled that these actions may be completed in any order.

 

Factual Background

 

In Raney v. Cerkueira, Veronica and Lawrence Cerkueira held property as joint tenants during their marriage. Veronica filed for divorce and, in February 2015, recorded a deed that severed the joint tenancy and transferred her 50 percent tenancy in common interest into a trust she had created and for which her son David Raney was the trustee and sole beneficiary upon her death. Veronica’s attorney emailed Lawrence’s attorney to notify him of this severance in March 2015. The next month, Raney filed a complaint for partition of the property by sale, which Lawrence was served in May. Veronica died in November 2015.

 

Trial Court’s Decision and Decision on Appeal

 

The trial court ruled in favor of Raney regarding the partition by sale and Lawrence appealed. He claimed that, in violation of Family Code Section 2040(b)(3)’s automatic temporary restraining order (ATRO), which provides that “[b]efore . . . a right of survivorship to property can be eliminated, notice of the change must be filed and served on the other party,” he hadn’t received notice from Veronica of her intent to sever the joint tenancy before she recorded the deed in February 2015.

 

Civil Code Section 683.2(c) provides that a joint tenancy severance is not effective to eliminate a right of survivorship unless it is recorded before the death of the severing joint tenant. Veronica did record the deed before her death, but provided notice after the filing, which Lawrence contended made the transfer invalid.

 

The appellate court disagreed and affirmed the trial court, holding that the ATRO under Section 2040(b)(3) allows for a party to eliminate a right of survivorship to property so long as notice of the change is “filed and served on the other party before the change takes effect.” In the case where a spouse first records the severance and then serves notice on the other party, the appellate court concluded, “the elimination of the right of survivorship takes effect when the notice is filed and served.”

 

Accordingly, although Lawrence didn’t receive notice until after Veronica filed the deed, the order of the fulfillment of requirements didn’t matter so long as they were ultimately completed, and the deed became effective as of the date notice was provided.